A.M. Best announced that it has downgraded the financial strength rating to B++ (Very Good) from A (Excellent) of Overseas Partners Ltd. (OPL) Bermuda, and removed the company from under review.
It indicated that the ratings changes also applied to the following OPL subsidiaries: Overseas Partners Re Limited (OP Re), Bermuda, Overseas Partners US Reinsurance Company (OPUS), Delaware and Overseas Partners Assurance Ltd. (OPAL), Bermuda.
The announcement recognizes OPL’s decision, announced last February, to begin an orderly run off of most of its operations. It has so far sold off its property catastrophe reinsurer, Overseas Partners Cat Limited, to Renaissance Re and, Best noted, “has made significant progress in liquidating some of its real estate holdings. Furthermore, management continues to work towards effecting the sale of OPUS and is currently working with an interested party to agree to final terms and conditions.”
Best said that the ratings change reflected its view that “the overall capitalization of the group with $1.3 billion of shareholders equity is adequate to support the run off of its liabilities, which include $1.7 billion of carried loss reserves. Moreover, OPL’s run off plans indicate that it will withdraw capital prudently and maintain shareholders equity at a level that meets or exceeds its carried loss reserve position.”
The ratings agency indicated it would “continue to monitor the adequacy of OPL’s loss reserves and capitalization.”|”a.m., best, downgrades, opl, ‘b++’, (very, good),
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